Local energy markets are required to solve challenges on the national power system, according to energy technology company Electron.
National Grid ESO is working on urgent arrangements to manage low summer demand exacerbated by coronavirus lockdowns, seeking to strengthen powers to turn off distribution-connected generation, and offering payment for voluntary curtailment.
Electron and other companies, including Ovo-owned Kaluza, have launched a local energy market in Orkney that intends to demonstrate how local energy trading can resolve those national challenges and reduce curtailment – where power is wasted because the grid cannot accommodate it.
When there is too much renewable power being generated, for example, the marketplace enables trading of that power into smart storage heating systems.
The TraDER platform has now completed some 1,300 trades.
“Despite Orkney’s small size, this project milestone could have a profound impact on the whole of the UK’s energy system,” said Kaluza’s head of flexibility, Conor Maher-McWilliams.
Electron CEO, Jo-Jo Hubbard, said that “coordinating national price signals with local grid requirements is absolutely key to maximising the incentive for local flexibility to come online and, in turn, enabling the zero carbon grid.
“Moreover, the more we see negative national electricity prices, the faster we need a solution that ensures that this does not disturb grid resilience at a local level.
The trial aims to bring in more businesses to the marketplace this later year. Other organisations involved include: Community Energy Scotland, CGI, EDF, Energy Systems Catapult, and Scottish and Southern Electricity Networks, plus Downing LLP and United Utilities.
The project is one of two marketplaces funded by Beis as part of its FleX competition. The other winner is Piclo, which is adding some interesting new aspects to its flexibility marketplace, including a flexible PPA matchmaker.
The company recently published two papers that suggest optimal use of flexibility – and appropriate enabling frameworks – could halve network investment out to 2050, and shave tens of billions of pounds off the cost of decarbonisation.